Victor Pigoga was less than thrilled when Blue Cross & Blue Shield of Rhode Island set out in early 2002 to find a vendor to run its computer systems.
“I wanted nothing to do with it,” said Pigoga, a Blue Cross veteran who had risen from an entry-level computer programmer in 1983 to become the assistant vice president of computer operations. Pigoga sat on an 85-member selection committee formed to whittle down the list of prospective outsourcers.
“From my point of view, they all were there to steal my job,” Pigoga said.
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Now, Pigoga is making occasional business trips to Plano, Texas, to visit the headquarters of his new employer, Perot Systems Corp. Instead of working for a nonprofit insurance company, he is employed by a publicly traded, rapidly growing technology firm.
And even though he still shows up to work every day at Blue Cross’ headquarters on Westminster Street in Providence, he says little else remains the same.
“It’s only been four weeks, and I couldn’t even imagine going back and working for Blue Cross,” Pigoga said in an interview June 27. “It’s just so comfortable, the relationship that’s in place now with Perot Systems.”
Pigoga is one of nearly 600 former Blue Cross employees who, with one stroke of the pen, became Perot Systems employees on June 1, part of a 10-year, $550 million contract for Perot to administer Blue Cross’ claims processing and information technology infrastructure. Nearly all effected employees were offered and accepted jobs with Perot; a handful opted for early retirement.
A big reason for Pigoga and other employees’ quick and easy affinity for their new employer might be, well, a computer thing.
IT and claims processing are not the strong suits of HMOs, which would rather focus their efforts on product design, marketing and health and wellness initiatives. Typically, a health insurer’s investment on internal IT and other back-office departments is kept lean, said Terrence Westropp, Perot’s senior manager for the Blue Cross account.
“Now these employees are coming into a company where what they do is our core business,” Westropp said. “We invest a lot of resources in those folks because they are our core competency.”
While their job functions still are largely the same, new Perot employees say they are keenly aware of their new corporate environment.
“It is a different mindset; you become aware that you’re not just an employee of a local company in one state – you’re now part of a global company,” said Fawn Martin, a 16-year Blue Cross veteran who also was part of the vendor-selection process.
“You tend to be more focused on deadlines. You don’t want to go back to the client and say ‘I can’t meet my deadline,’ whereas before it might have been a little more lenient,” said Martin, a system-integration manager.
Pigoga and Martin both said they enjoy Perot Systems decentralized structure – something the company has prided itself on since its founding in 1988 by former presidential candidate Ross Perot. For example, the company doesn’t have much use for formal titles.
“That was a big part of the appeal of the company for me,” Martin said. “The people weren’t pretentious at all. Nobody had titles – they were all ‘associates.’”
About 350 new Perot “associates” are handling Blue Cross’ claims-processing and other back-office functions. They adjust and process claims, enroll and bill Blue Cross members and cut checks to health-care providers.
It is there, in the claims-processing department, where perhaps the biggest change will come: the transition from Blue Cross’ decades-old system to Perot’s proprietary claims-processing technology, which it calls “Diamond Enterprise.”
Using the new platform, which will take three years to fully implement, employees will be able to configure changes quickly, rather than rewriting software code. The time it takes to tweak individual accounts or even implement a new Blue Cross product could go from weeks or months to just days, Westropp said.
Extracting claims data and responding to member inquiries should be much simpler too, he said.
Perot also plans to set up a Web portal over the next two years that would allow members to change their primary-care doctor online, for example, or let doctors and hospitals check the status of a claim.
Another 250 employees work in the IT department as computer programmers, network engineers and data-operations specialists, supporting local and wide-area networks and servers, running data batches and operating the IT help desk.
Absorbing a wave of new employees is nothing new for Perot Systems, which now has more than 9,000 employees in North America, Europe and Asia.
Perot has taken in new employees – either via acquisitions or through contracts like the one with Blue Cross – more than 60 times in its history. For example, the company signed a 10-year, $700 million contract in 1999 with Harvard Pilgrim Healthcare, transitioning roughly 1,000 employees. Westropp spent the past three years managing that account.
Perot is looking for a permanent location somewhere in the Providence area, but will remain in the Blue Cross building for the time being.
Perot plans to use its new presence in Rhode Island to win new contracts, especially with hospitals and large health systems.
“We like to say that with this contract, we now have 600 new sales folks in the Rhode Island area,” said Chuck Lyles, Perot Systems’ Healthcare Group leader. “Our focus is on doing a good job for Rhode Island, but we would like to expand to a regional service center for both payers and providers.”
Perot is one of the country’s largest providers of outsourced IT systems to hospitals, with more than 300 accounts, including four contracts among the country’s 20 largest health systems.
